1. An Overview of Fiber to the Home Deployment - Status & Trends
FiberWeek 2010, Croatia
Dr. Igor Brusic
SBR Juconomy Consulting AG
Split, 29.04.2010
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2. 1 Why Fiber to the Home?
2 FTTH Deployment Worldwide / Europe
3 Economic Challenges
4 Regulatory Challenges
5 New Business Models
6 Summary and Outlook
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3. Introduction - SBR
SBR Juconomy Consulting AG offers sound business, technical, regulatory and
legal advice on regulated markets in the telecoms sector and other network
industries (post, electricity, gas, railways), as well as the media and information
technology (ICT) segments
Established on 1 March 2004
Track record of >100 projects in the telecommunication sector
Consulting of utility service providers regarding the cooperation potential for fibre-
based network roll-outs and regulatory questions concerning the use of different
access technologies
Ongoing support to municipalities and utility providers with regard to building their
own broadband network infrastructure and the migration from unbundling local-loop
to an FTTX strategy
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4. Why Fibre to the Home (FTTH)?
Source: http://www.useit.com/alertbox/980405.html
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5. Why Fibre to the Home (FTTH)?
Source: A.T. Kearney/Hellenic Ministry of Transport&Communications/Broadband Strategy/May 2008
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6. Why Fibre to the Home (FTTH)?
Source: McKinsey&Company, Creating a Fiber Future, White Paper, 2010
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7. Why Fibre to the Home (FTTH)?
Source: OECD adapted from “Electricity and Economic Growth”, Committee on Electricity
in Economic Growth, Energy Engineering Board, National Research Council (1986).
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8. Why Fibre to the Home (FTTH)?
Source: Based on Technological Revolutions and Financial Capital: The
Dynamics of Bubbles and Golden Ages, Carlota Perez; IBM 2004 Annual Report
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9. Why Fibre to the Home (FTTH)?
The choice is yours …
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10. 1
1 Why Fiber to the Home?
Why Fiber to the Home?
2 FTTH Deployment Worldwide / Europe
3
3 Economic Challenges
Economic Challenges
4
4 Regulatory Challenges
Regulatory Challenges
5
5 New Business Models
New Business Models
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6 Summary and Outlook
Summary and Outlook
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11. FTTH Global 2009
Source: FTTH Council Europe
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12. Countries (> 1% of FTTH)
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13. USA
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14. Asia
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15. Australia
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16. Europe
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17. Europe / Countries
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18. 1
1 Why Fiber to the Home?
Why Fiber to the Home?
2
2 FTTH Deployment Worldwide // Europe
FTTH Deployment Worldwide Europe
3 Economic Challenges
4
4 Regulatory Challenges
Regulatory Challenges
5
5 New Business Models
New Business Models
6
6 Summary and Outlook
Summary and Outlook
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19. Economical challenges
Very strong dependency
How much has to be invested? on revenue and number of
users
How much the user
is ready to pay? Fixed costs and variable
costs
Highest investments costs
in access network infra-
structure because of civil
work (50-80%)
Operators are investing if:
Business model is
How many users will pay for it? positive, or
Strategic decision
Source: Dr. Raul Katz: Ultrabroadband telco investment models; Ultra Broadband Seminar, Paris, April 2008
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20. 1
1 Why Fiber to the Home?
Why Fiber to the Home?
2
2 FTTH Deployment Worldwide // Europe
FTTH Deployment Worldwide Europe
3
3 Economic Challenges
Economic Challenges
4 Regulatory Challenges
5
5 New Business Models
New Business Models
6
6 Summary and Outlook
Summary and Outlook
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21. Regulatory challenges
If the fiber network is built by the incumbent, without regulatory
holidays, probably it has to be open for use by alternative
operators
Symmetrical or asymmetrical regulation?
Ex-ante or ex-post obligations/remedies?
Focus on infrastructure or service competition?
Higher return on capital invest because of higher risk?
Defining network elements, for which SMP is relevant and to which
access is to be granted (ducts, dark fiber, collocation)
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22. Possible solution
Hurdles Consequences Solution
Market uncertainty
Private sector will Harmonizing of investment
Harmonizing of investment
probably hold back incentives and operator‘s
incentives and operator‘s
Regulatory uncertainty with investments in strategies through
strategies through
• Regulatory holidays – PPP-Projects
fiber if pay back is not – PPP-Projects
• SMP analysis
ensured under given –
– Open Access Models
Open Access Models
market and regulatory –
– Obligation to provide
Obligation to provide
conditions wholesale-offers
wholesale-offers
Fostering of investment
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23. 1 Why Fiber to the Home?
Why Fiber to the Home?
2 FTTH Deployment Worldwide // Europe
FTTH Deployment Worldwide Europe
3 Economic Challenges
Economic Challenges
4 Regulatory Challenges
Regulatory Challenges
5 New Business Models
6
6 Summary and Outlook
Summary and Outlook
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24. New business models
Passive Infrastructure Active Infrastructure Services
AB Stokab Dark Fiber
Provider 1 many plenty
ndix Digital Marketplace
Provider 1 plenty
Singapore and
NetCo OpCo Retail Service Provider
Australia
Provider 1 1 plenty
Schwerte and
Verticaly integrated operator
M-net
Provider 1
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25. 1
1 Why Fiber to the Home?
Why Fiber to the Home?
2
2 FTTH Deployment Worldwide // Europe
FTTH Deployment Worldwide Europe
3
3 Economic Challenges
Economic Challenges
4
4 Regulatory Challenges
Regulatory Challenges
5
5 New Business Modells
New Business Modells
6 Summary and Outlook
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26. Summary
Fiber as the new infrastructure
Difficult business model for operators
Private sector can´t capture social benefits and economical impact
(externalities like rising employment, higher tax income, reduced
outflow of people, business settlement, CO2 reduction, etc.)
Governmental support can be essential (Sweden)
Rural areas are in a unfavorable position (World)
Regulation matters but regulatory holiday can´t save rural areas (USA)
Fiber is squeezing out xDSL (Japan)
Municipality networks and open access as a possible solution (Europe)
There is no „one-fits-all“ approach in deploying fibre
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27. Outlook
Fibre is the ultimate solution of the broadband challenge
Mobile networks (LTE, WiMAX) are not competing but promoting the
acceptance of FTTH
Infrastructure competition is not a way to count on fostering national fibre
roll-out
Governments have to play a bigger role by
Promoting e-government, telemedicine, telework and online learning
Favorable tax policies
Investing/funding fiber roll-outs in rural areas
But this is not (yet) part of the Croatian government economy recovery
program (http://www.slideshare.net/manjgura/program-gospodarskog-oporavka)
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28. Contact
SBR Juconomy Consulting AG
Nordstrasse 116 Parkring 10/1/10
40477 Düsseldorf 1010 Wien
Deutschland Österreich
Tel: + 49 211 68 78 88 0 Tel: + 43 1 513 514 0 15
Fax: + 43 1 513 514 0 95
Fax: + 49 211 68 78 88 33
URL: www.sbr-net.com
URL: www.sbr-net.com
E-mail: brusic@sbr-net.com
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29. Main incentive for FTTH for Iliad
Source: Iliad, FY 2008 Results and Strategy Presentation, March 19th 2009
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